Weekly Update

Simplicity and cost will be key to cracking open the wearable device market

Market research firms and analyst houses are practically stumbling over themselves to churn out sky-high forecasts for the suddenly-hot wearable device market. Juniper Research predicts the segment will explode from a $1.4 billion industry this year into a $19 billion market by 2018. Berg Insight claims 64 million wearable devices will ship in 2017, marking an average annual increase of more than 50 percent from 2012, and IMS Research believes the market is even more promising. Meanwhile, IDC cut its projection for worldwide tablet sales due to expected increasing competition from smartwatches, connected glasses and other gadgets.

All those announcements came in just the last few weeks. And nearly all those projections claim that fitness- and health-centric devices will lead the way as the wearables market begins to take off, with more sophisticated gadgets like Google Glass following in short order. I’m participating in a panel discussion on wearable devices at our Mobilize conference this afternoon, so I’ve spent a lot of time lately thinking about that market. And in the early days, at least, I think manufacturers and app developers should focus on these key areas:

Simplicity. Apple blew open the smartphone market – and single-handedly created the tablet market – because its devices are remarkably simple and intuitive. Those principles will be even more important in the early generation of wearable gadgets because they will be so tightly integrated with our everyday lives. That may seem like an obvious point for rudimentary fitness apps, which users may not even think about on a daily basis. But it’s also true for devices like Google Glass, which is largely controlled by users’ eye movements or voice commands. Those controls must always be simple, intuitive and accurate for any wearable device to be valuable for mainstream users.

Design. Consumers will often trade smaller size and less portability for more functionality, as evidenced by the recent trend toward smartphones with larger screens. That won’t be the case with wearables, though, which will need to be as lightweight, streamlined and inconspicuous as possible. No wearable device will find a mass-market audience if it feels like an albatross, constantly reminding users that it’s there. And manufacturers of highly visible wearable devices must always consider the role fashion and style plays in what we wear.

Cost. We’ll see a wide range of price points as the wearable device market takes off, and for good reason: Users will surely pay much more for a high-tech screen that users augmented reality and other technologies to provide a constant stream of information than they will for, say, a tiny gadget that counts their steps every day. But the cost of data will also be very important here: Only hardcore tech types will pay a hefty monthly sum for wearable-device data on top of their smartphone plans. So vendors must find ways of transmitting and leveraging as much data as necessary without blowing up their customers’ monthly budgets.

Of course, there are many other challenges that will be crucial as the wearable device market moves beyond niche gadgets into the mainstream. The evolution of apps for wearables will be an ongoing factor for many types of devices, and power will be a major concern. And because some wearable devices will record and transmit some of our most personal data, privacy issues will need to constantly be addressed. But the biggest challenge for vendors in these early days of the wearable device market will be in producing gadgets that are easy to use and add value to our everyday lives without getting in our way or adding much to our monthly mobile budget.